Earning like an M40, but living like a B40

Earning like an M40, but living like a B40

How an 'unjust' metric saw many fall through the cracks.

Many Malaysians question the calculation used to categorise people in the different income brackets.
PETALING JAYA:
Ken (not his real name) recalls how his father, the sole breadwinner, struggled to provide for a family of four, without any government aid.

His father did not fall into the B40 category due to his income which saw him classified as M40.

“We did not qualify for government aid because of a single digit,” the 26-year old auditor lamented.

Households which fall in the B40 bracket have a monthly income of RM5,250 and below. Households are classified as M40 if they have an income of between RM5,251 and RM11,819 a month.

Till today, Ken is still questioning the metric used to determine the categories, which he says is “unjust”.

Apart from the B40 and M40, households with a monthly income of RM11,820 and above are categorised as T20.

However, the complicated situation that Ken’s family found themselves in, as well as many like his, will no longer be a problem.

Last month, Prime Minister Anwar Ibrahim said the government will tweak the way it measures poverty based on the Net Disposable Income (NDI) to identify recipients of government aid.

The NDI, he said, would take into account the Basic Minimum Living Expenditure (PAKW), which refers to the cost for a decent living, including expenses for food, clothing, accommodation, utilities and transportation.

Junaidi Abdul Rahman
Junaidi Abdul Rahman.

Junaidi Abdul Rahman, who works in the private sector, praised Anwar for having the courage to refine the system, even though it was an unpopular move.

“Like he always says, ‘let me make the unpopular decisions as long as it benefits the people’.

“As one who earns a lot but has many commitments, we are now equal with the low income earners,” Junaidi, 51, said.

He said the previous formula saw many who were deserving of government aid slip through the cracks.

Law Jia Chang
Law Jia Chang.

Financial officer Law Jia Chang, 27, said PAKW highlighted the government’s commitment to ensure that aid was distributed fairly.

Law said PAKW’s calculations were more accurate and equitable, both for the government and the people.

Stay current - Follow FMT on WhatsApp, Google news and Telegram

Subscribe to our newsletter and get news delivered to your mailbox.